A spokesman for the National Investigation Agency (NIA) said the office and residence of Devinder Singh Behal, chairman, Jammu and Kashmir Social Peace Forum (JKSPF), a constituent of Tehreek-e-Hurriayat headed by Geelani, were searched in Jammu.
Behal is also a member of the legal cell of the separatist amalgam led by Geelani and a "close associate" of the Hurriyat hawk. Behal, the anti-terror probe agency said, also regularly attends the funeral processions of militants.
"The NIA is investigating his role as a courier as he is suspected to be involved in routing funds to separatist leaders from Pakistan-based handlers," the spokesman said.
He claimed several incriminating documents, four mobile phones, a tablet computer and a few other articles were seized during the searches, and Behal was being questioned.
In a related development, the NIA also issued summons to Naseem, the younger son of Geelani, asking him to appear before it on Wednesday.
Geelani's elder son, Nayeem, who was asked to present himself at the agency's headquarters in New Delhi tomorrow, has been admitted to a hospital in Srinagar after he complained of chest pain, members of the Hurriyat faction said.
Nayeem, a surgeon, had returned from Pakistan in 2010 after spending 11 years and is considered Geelani's heir apparent.
Nayeem was to be questioned in connection with the terror funding case which has named Hafiz Saeed, leader of Pakistan- based Jamaat-ud-Dawa and banned terrorist outfit Lashkar-e- Taiba, as an accused.
The NIA has also named separatist organisations like the two factions led by Geelani and moderate leader Mirwaiz Umer Farooq, Hizbul Mujahideen (HM) and all-woman outfit Dukhtaran-e-Millat in its FIR.
Geelani's son-in-law Altaf Ahmed Shah alias Altaf Fantoosh has already been arrested by the NIA and was being interrogated.
Besides him, Geelani's close aides Ayaz Akbar, spokesman for Tehreek-e-Hurriyat, and Peer Saifullah were arrested from the Valley last week.
Shahid-ul-Islam, spokesman for the moderate Hurriyat Conference led by Mirwaiz Umer Farooq, Mehrajuddin Kalwal, Nayeem Khan (of the Hurriyat's Geelani faction) and Farooq Ahmed Dar alias 'Bitta Karate' have also been arrested. All of them have been remanded in 10 days NIA custody.
The NIA had registered the case on May 30, accusing separatist and scessionist leaders of being in cahoots with terrorist groups.
The case was registered over raising, receiving and collecting funds through various illegal means, including through hawala channels, for funding separatist and terrorist activities in the state and for causing disruption in the Valley by pelting security forces with stones, burning schools, damaging public property and waging war against India.
The NIA conducted searches in several places in the state besides Haryana and the national capital. Electronic devices and valuables worth crores of rupees were impounded.
It is for the first time since the rise of militancy in the early 1990s that a central probe agency has conducted raids in connection with the funding of terrorist and separatist groups.